RBI MPC set to keep rates on hold; needs to assuage war-rattled markets
The Reserve Bank of India is expected to keep interest rates unchanged at its upcoming monetary policy meeting due to the ongoing war in West Asia and rising inflationary pressures. The central bank will need to signal its readiness to take necessary actions to deal with extreme market conditions and retain flexibility in its monetary policy.
The Reserve Bank of India will likely keep interest rates unchanged at its April 8 meeting. The repo rate is currently at 5.25%. The central bank will revise inflation and growth targets due to the ongoing war in West Asia. Crude oil prices and the rupee have been volatile, prompting the RBI to take urgent policy measures in March. The RBI will need to signal its readiness to take action whenever necessary. India's macro-economic conditions were positive before the war, but the conflict has introduced uncertainty.
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